E3 2016: Project Scorpio and PS4 Neo leave video game business at a crossroads, Nintendo make their presence felt and everything else we learnt this week

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E3 is over for another year. And while gaming’s biggest conference is changing, it was still packed with great games and big hardware announcements, laying out a vision of the future of interactive entertainment. There was plenty to chew over, both positive and negative, so here is our main takeaways of the trends and lessons learnt from E3 2016.

The console business is undergoing a major change… and the future is uncertain

At its conference on Monday, Microsoft fired the opening salvo in an altogether new kind of arms race in the console business. Project Scorpio, the 4K-enabled, VR-ready upgraded version of the Xbox One, will release at a premium price at the end of 2017. Sony, meanwhile, has confirmed the existence of the PlayStation 4 Neo, a similar prospect. Remodelled consoles and firmware updates have been a constant in the lifespan of video game consoles for a while now, but this kind of technical leap mid-cycle is unprecedented.

The theory is that neither Scorpio nor Neo will have ‘exclusive’ games, and all software will work with the original Xbox One (and the also announced slim version) and PlayStation 4, while owners of the premium boxes will receive technical benefits (primarily 4K ultra-high-definition resolution).

Xbox boss Phil Spencer unveils Project Scorpio at E3 2016

The conversation following Scorpio’s reveal has been muddled. Xbox boss Phil Spencer said in one interview that people that don’t own 4K TVs will not see any benefit of Scorpio, while in another suggested developers can do what they choose with the extra 6 teraflops of processing power housed within their new box.

It has also sparked not unreasonable questions over whether the imminent release of Scorpio will slow sales of Xbox One models and if, assuming the consoles truly have equal compatibility, what is the real point of this bump before a proper ‘generational’ leap to a new console altogether. This is further muddled by Microsoft’s decision to basically abandon the idea of Xbox One exclusivity altogether, publishing its first-party titles across both its console and Windows 10 PCs with its ‘Play Anywhere’ scheme. It is a splendid offering, with digital games available on both platforms at no extra cost, game saves carrying over between devices and even cross-platform multiplayer, but only casts further doubt about the future of the console.

With Microsoft facing these questions head on following the Scorpio’s reveal, Sony must be delighted they chose to wait to unveil Neo. Watching the fallout of Scorpio unfold means PlayStation can potentially evaluate and adjust before detailing its own plans. But confusion is likely to reign over both companies as the release of the upgraded consoles come into view.

It feels like the console business is at a crossroads. There is the possibility that this could change the generational cycle forever, with incremental updates of consoles treated much like upgrading a PC or smartphone rather than seeing major leaps like the switch from Xbox 360/PS3 to Xbox One/PS4.

The other simpler, cleaner possibility is that Scorpio and Neo are one-offs. A necessary diversion due to the increasing popularity of 4K televisions and the emergence of power-hungry virtual reality headsets. And once this dual technical challenge has been incorporated into premium consoles for bleeding edge tech-heads, things might return to how they were before. This doesn’t seem likely. And the fact that neither Microsoft nor Sony are willing to say which way the road will go means they simply do not know.

The brilliance of The Legend of Zelda: Breath of the Wild meant Nintendo didn’t go unheard

There is a common adage in the video game industry: ‘never write off Nintendo’.

While Microsoft were outright announcing a new machine and Sony were making noises about one, Nintendo held true to their statement that its new console due in March –the mysterious NX- would not be discussed.

Instead, Nintendo chose to showcase just one game on its soon to be euthanised Wii U – the new Legend of Zelda.

Nintendo has always done things its own way, but what fresh madness was this? Writing off almost an entire year of the industry’s biggest showcase while its ostensible rivals geared up for their own technical upgrades.

The Legend of Zelda: Breath of the Wild

But Nintendo were not to be drowned out. While Nintendo missed the packed conference news cycle, Breath of the Wild (as it is now known) was the talk of the town around the show floor. Nintendo were not messing around, using its usual enormous floor-space to recreate a life-size Link, Moblins and Guardians from the new game in comfortably the most lavish booth at the show. Queues of five-and-a-half hours snaked around the LA Convention Center’s West Hall, all to have the chance of 35 minutes of play with the game.

But what a 35 minutes it was. Breath of the Wild is Nintendo’s most ambitious game in years, opening up Zelda’s world with expansive, inventive elan. As the presenters on Nintendo’s booth were keen to establish, the demo was just 1% of the biggest Zelda yet. I climbed an enormous tower and puzzled through one of the game’s 100 shrines with physics-based magnetic tasks. Others still talked of shield-surfing and swimming, every one of the booth’s screens showing a different part of Hyrule’s gorgeous landscape.

It made quite the impression. And the most impactful thing for Nintendo? It will be a launch title for the NX. While it didn’t give away many clues to the console’s form, that it will arrive on the market with arguably E3 2016’s best game is as big a statement of intent that Nintendo could wish for.

Virtual reality rolls on

Virtual reality is already in many homes with this year’s release of Oculus Rift and HTC’s Vive. But for the time being remains the occupation of hardcore tech fans. Largely due to high prices and the fact that the tech companies are not yet reaching for mass market. However, E3 2016 felt like the start of the charm offensive to get VR into more homes. Microsoft announced that Scorpio will be VR-ready, though wouldn’t commit to what headsets will be compatible (though it is likely to be Rift). But it was Sony making the most noise this year, giving a release date for its PSVR headset (13 October).

PSVR at E3 2016

At £349, PSVR represents virtual reality’s best shot at the mainstream. Many of Sony’s announcements at the Playstation conference were related to VR and there is a clear grab for the mainstream. With Batman Arkham VR and an add-on for Star Wars Battlefront, Sony was putting VR in terms everyone can understand. You can be Batman, you can fly an X-Wing. Wish fulfilment on an easy to understand scale.

Elsewhere, more traditional games impressed. A virtual reality demo of Resident Evil 7 was getting under everybody’s skin, while Rebellion’s BattleZone was as good a playable VR demo as we’ve seen. VR might already be here in some form, but this was its populist push.

E3 is changing, but remains relevant

There is some doubt over the future of E3. Nintendo has long-abandoned its once traditional press conference and this year decided to keep its NX unveil to itself. Activision and EA moved away from the show floor for the first time, Activision keeping its showcases of Call of Duty: Infinite Warfare and Skylanders to meeting rooms in the conference center, while EA hosted its own event down the road at LA Live. It was certainly quieter on the show floor without the rumble of this pair, which makes it rather nice for a journalist running between appointments, but both made their presence felt. While Bethesda, Sony and Microsoft all made several significant announcements during the week. It would help if these game companies could stop all of their info leaking out in the days leading up to the show, but with Scorpio, PSVR and several big game reveals, this remains gaming’s biggest week of the year.

The crowds at E3 2016

In some ways, the changes that happened this week were for the better, making the intensity of the week more manageable for its attendees. The show will continue to evolve, it needs to evolve to remain relevant in this age of 24/7 news cycles. But for now, it is still the biggest show in town.

It would be remiss to ignore the horrific events that happened in the US just hours before E3 began. Like the rest of the world, there was a pallor cast over E3 in the light of the tragic Orlando shootings in which 50 people lost their lives. Covering video games is a trivial pursuit at the best of times, but in the light of such barbarism it becomes an insignificance.

Yet we carry on, of course. Because we must. The theory being that an inch given here is an inch lost in this war on our way of life. Our culture.

But there was a definite sense of unease at the world’s biggest video games show. E3 is purposefully the industry at its most gauche and bombastic, announcing its upcoming blockbusters with all the subtlety of a brick through a window. That’s fine. No-one expects much in the way of quiet reflection when it comes to a show that has long been the centre-piece of the triple-A industry. But so much of its wares revolved around guns and violence. It is rare that the games industry feels uncomfortable in that skin, but there was signs of it here. Tales of increased security at Bethesda and Xbox showcase rippled through the queues, while the dissonance of the games being shown in LA as the country reeled from its worst mass-shooting was clear.

So at Bethesda’s showcase you had Tim Willetts of id Software wearing the rainbow pin that has become a symbol of support for the LGBT community rocked by an act of pure hate while presenting the fast-paced shoot ‘em up Quake Champions. Dishonored 2, meanwhile, took particular pleasure in the myriad ways your assassins can murder your targets. At the Xbox conference the next day, Xbox boss Phil Spencer started the show with a message of support to those killed before the gathered crowd whooped and hollered at a hyper-violent Gears of War video. This isn’t Bethesda or Microsoft’s fault, of course, and that the companies should take pause to pay their respects is proper and right. Nor should we feel guilty about the cathartic pleasures of our hobby. But in a post-Pulse world, it couldn’t help feel a little perverse.

We should not be ashamed of the things we enjoy, and there is no doubt that some of the most rewarding and interesting games on show featured combat and deal with death. But when the real world is as violent as it is, that we take such pleasure in its digital recreation should be cause for reflection.